A simple idea on assessments

Whenever I give a speech or talk about Strong Towns issues with people, I typically get a vigorous affirmation on our analysis of the problems we face followed by a simple question:

Okay, so what do we do?

Of course, I always try to touch on this subject when speaking but my thoughts on it are complex and, admittedly, not as well developed as our analysis of the issues. My honest answer is that "it depends on the community", and I really mean that because the solutions are mostly local. Hyper-local, in fact. This is especially true since federal and state policies towards subsidizing our current development pattern don't seem likely to change anytime soon.

Our homogeneous approach to building communities masks a level of complexity that is difficult to fully comprehend. I laugh when each city's community plan has the obligatory statement about the "unique character" of that community, like their gas stations, strip malls and snout-houses are distinct from those of their neighboring town (let alone, a community on the other side of the country).

But the fact is, when one gets hyper-local, everything changes. There, the unique character of a community does matter. Regional centers have much different approaches than neighborhood centers. Auto-era communities have a different set of challenges than traditional neighborhoods. Farm communities differ from forest communities.

Today's approach of primarily greenfield development on the periphery has made zoning -- not planning -- the craft practiced by most planners. Changing that is not a one-size-fits-all solution.

For the sake of discussion (and please feel free to discuss - I would rather take the arrows here and have the flaws of this idea revealed), I would like to throw out a simple idea on assessments that may bring us closer to building Strong Towns on a larger scale.

In Minnesota (and I believe many other states), local governments are able to "assess" property owners for public improvements that are made that improve the value of their property. For example, if the property has no public water supply, when the city installs a new water pipe in front of the property and allows that property to hook up, the cost of installing the pipe and connection can be assessed to the property owner. The idea here is that the public purse should not be used to improve an individual's property values.

The catch that we use here in Minnesota, and I think it is applied elsewhere as well, is that the amount of the assessment cannot exceed the additional value added to the property. In my example, if the new water connection costs $10,000 but only increases the value of the property by $6,000, the remaining $4,000 would need to be paid by the city.

This all makes assessments for maintenance extremely difficult, if not illegal in most instances. If the property has public water service one day, and the next day the city installs a shiny new water pipe to replace the old one, the property is not going to sell for any more money. While a lot of cities assess some of the costs of maintenance -- typically just enough to bother but not enough to make it worth a lawsuit by the property owner -- most maintenance is paid from non-assessment revenues.

And that is the change I am mulling over; Let's authorize, or even require, local governments to assess the costs of infrastructure maintenance.

Right now, the initial cost of infrastructure is most often paid by one of the Mechanisms of Growth, thus masking the true cost for the property owner. In the transaction, the public trades a near-term cash-flow advantage for a long-term liability. The property owner pays taxes and user fees and expects the public to maintain the infrastructure indefinitely. 

Of course, the numbers ultimately don't add up.

If maintenance costs were assessed, there would be a more direct connection between the property owner and the long-term costs of the pattern of development they have chosen. We're all for choice - this would make that choice real. I suspect over time that a more efficient, more market-based pattern would emerge. I also suspect that pattern would be more dense and have better urbanism than the pattern of development we have grown used to in America.

Assessing for maintenance would also open up some options for Gov't 3.0 initiatives, like individual or neighborhood sinking funds for infrastructure maintenance (think of a 401(k) for fixing your street) and increased public involvement (or actual devolved decision-making) on things like level of service, the value of preventative maintenance and the urgency of specific improvements.

It's a simple idea. I'd love to hear the problems it would create and collectively find out if they would exceed the problems they would solve.

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